Bright outlook for falling prices in the housing market
Real estate agents in most parts of the capital are talking about the collapse of the housing price bubble and the reduction of sellers' bid prices. An issue that the Minister of Roads and Urban Development considers its sustainability conditional on the continuation of currency exchange rate decline and market intervention.
According to the International Iranian Stone Exhibition, last week the head of the Tehran Province Real Estate Advisors Union said: If the dollar continues to depreciate in the market, house prices will fall.
"Mostafa Gholi Khosravi" had said: "For a long time, the value of property in the country has depended on the price of the dollar, and for this reason, now the price of property in the country is accompanied by a huge bubble."
"As soon as the dollar rises, apartment prices will rise, but the fall in the dollar will not immediately lead to a drop in housing prices, because expecting the dollar to return to an upward trajectory will lead to market resistance to falling prices," he said. However, the monitoring of the housing market indicates that if the dollar continues to depreciate and the dollar remains at a balanced price, we will inevitably be accompanied by falling prices in the housing market.
According to this report, the prediction of this union official came true and the decrease of 4,000 Tomans in the price of the dollar in the past month led to a decrease in housing prices in many parts of Tehran, but not as expected from the decrease in the price of 3,000 Tomans.
For example, the region of two capitals, of which Sattar Khan and Daryan-e-Naw neighborhood are a part, in the past few days, housing prices have decreased from 52 million Tomans per square meter to 48 million Tomans, but the housing price bubble in this neighborhood of Sattar Khan is about eight million. Tomans per square meter, which creates the expectation of reduction and stabilization of the rate at 43 million Tomans per square meter.
In the west of Tehran, in the Sadeghieh neighborhood, there is a similar situation. Many property sellers have fallen short of last week's prices and are willing to sell their property up to three million meters less than in previous weeks.
A real estate agent in the western part of Tehran told IRNA: "Early last week and this week we saw a decrease in the bid prices of residential apartments in different parts of the capital." The housing market reacted to the psychological impact of economic markets, and the decline of economic markets such as coins and dollars was also reflected in the housing market, but the important point is that as soon as the dollar rises, we see the behavior of sellers change again.
He said: "Now the atmosphere of the housing market is declining and we are witnessing a rush to sell. There is an expectation of improved relations with the United States in society and this has reminded many real sellers and housing traders of the failure of prices after the signing of Borjam. The supply of files at a lower price has increased.
The housing market activist added: "The volume of files in some real estate startups has also increased, and the price offered by sellers in areas of the city has dropped by 15 to more than 25 percent compared to last week."
Experts believe that if the exchange rate continues to rise in the price range of 4,000 Tomans, the housing market will also face a price bubble, but now many sellers are not willing to reduce prices further for fear of a further rise in the dollar.
Minister of Roads and Urban Development "Mohammad Eslami" on Monday, referring to the significant decline in foreign exchange prices in the market and its impact on housing prices, said: "The fall in exchange rates and gold naturally affects goods and services, including housing."
He continued: "Although prices increase with the growth of currency and gold, but when we face a decrease in the price of currency in the market, the return of prices is not easily possible."
The Minister of Roads and Urban Development stated: "Now, despite the significant decline in currency prices, the market is showing stubbornness in the return of prices and has a stickiness that must be intervened to solve this problem."
The latest housing prices according to the Central Bank
According to this report, the average price of housing in Tehran for October this year, according to the Central Bank, was 26 million and 720 thousand tomans per square meter. This index has increased by 10% compared to last month and 110.1% compared to the same month of the previous year.
The number of housing transactions in October of this year was 8,656, which is a growth of 2.3 percent compared to the previous month, which was 8,463, and compared to the same month last year, when 3,401 were registered. Shows an increase of 154.5 percent.
The highest number of units traded in Tehran by life units based on units up to five years of construction with a share of 37% of total housing transactions in October. Units of 16 to 20 years of construction were next with 19% of total transactions.
* IRNA
